When Every Practical Economic Idea Is Political Suicide, Something's Wrong With Politics

from the too-bad dept

Last week, Planet Money brought together five different economists, who represent a pretty broad spectrum of political ideologies in general, to see what policies there are that all of them (mostly) agree on -- and then noted why every single one of those policies is political suicide for a Presidential candidate. The list of economists is a fantastic one, including my Econ 101 Professor, Robert Frank (who I forever remember kindly for letting me take my first ever college final exam late, after I accidentally overslept, waking up in my dorm room an hour and a half after the exam began...). Also included is Russ Roberts, whose writings and thoughts on economics I follow closely. Then there's Dean Baker, whose work we've cited here a few times. Next up is Luigi Zignales, who I had the pleasure of meeting a couple months ago, and whose new book, A Capitalism for the People is on my shortlist of books I need to read this year. Finally, they have Katherine Baicker from Harvard, whose done really interesting work on health care economics -- a field that needs plenty of study.

So what policies did all five agree on? Here's the list (though you really should listen to the podcast to hear them all talk about the details)

One: Eliminate the mortgage tax deduction, which lets homeowners deduct the interest they pay on their mortgages. Gone. After all, big houses get bigger tax breaks, driving up prices for everyone. Why distort the housing market and subsidize people buying expensive houses?

Three: Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich people.

Four: Eliminate all income and payroll taxes. All of them. For everyone. Taxes discourage whatever you're taxing, but we like income, so why tax it? Payroll taxes discourage creating jobs. Not such a good idea. Instead, impose a consumption tax, designed to be progressive to protect lower-income households.

Five: Tax carbon emissions. Yes, that means higher gasoline prices. It's a kind of consumption tax, and can be structured to make sure it doesn't disproportionately harm lower-income Americans. More, it's taxing something that's bad, which gives people an incentive to stop polluting.

Six: Legalize marijuana. Stop spending so much trying to put pot users and dealers in jail — it costs a lot of money to catch them, prosecute them, and then put them up in jail. Criminalizing drugs also drives drug prices up, making gang leaders rich.

So there you go. Six proposals from five economists who represent a very wide spectrum of political views, which they all agree on. And nearly every one of those is political suicide (though, to be fair, Libertarian candidate -- and former beloved New Mexico Governor -- Gary Johnson's platform actually does include many of these).

The show suggests they're going to explore in future episodes why so many proposals that a large number of economists think make sense are simply politically unfeasible, and I look forward to that. But, a lot of these are situations where old policies effectively locked us in, and making changes would upset an awful lot of existing infrastructure and jobs, not to mention beneficiaries of those policies. And that's one of the reasons why we're always a bit worried about government leaping in to regulate areas where they don't fully understand what's going on. Those regulations can (and often do) lock us into a situation that is not easy to get out of -- even if getting out of it makes a lot of sense...

What's really unfortunate, of course, is that we can't even have reasonable discussions about most of the proposals above. Bringing up nearly any of them is considered a political non-starter, even though if people really understood the overall impact of them, they might agree that all are at least worthy of discussion.

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Good luck! Hope that SS still exists when you need it.

That is what I've been thinking all along. When I retire in 40 years, at age 78 (the minimum retirement age by then,) SS won't be there. So SS is pretty much my donation to keep the people in my parent's generation happy with themselves. I hope that I'll be able to enjoy what little I've built up in investments and funds by then, but considering my risks, I probably will be working the rest of my life and won't get a retirement.

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wassamattau ! ? ! ? ! ?
*shhhhh*
the korporadoes (and their proxies, 'our' (sic) kongresskritters) don't want anyone to hear those inconvenient factoids: they want to loot social security and turn it into a private korporate killing field where grandma and grandpa will be fleeced...
its the neo-amerikan way ! ! !
thus they have to demonize social security before they 'rescue' it by privatizing it...
(which will then be the destruction of it...)
it is not social security which is 'worthless', it is the IOU's unka sam has been putting in the social security not-so-locked-box which are worthless...
it is a sham and a shame...
art guerrilla
aka ann archy
eof

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so sorry to hear of your limitations, hope the rest of the world conforms to your oh-so-reasonable expectations...
...dingleberry
(ps i can write 'proper english' rings around a self-limited asshat like you, but i choose my own inimitable style because i enjoy word play...
pedantic, tiresome grammar nazis? not so much enjoyment...)

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I don't have an SS and I am not worried about the future.
First and foremost I want to believe if the time comes that I have to endure something awful I will be a big boy and take it like a man, but most importantly, I have build a library of knowledge about the things I will need and am developing the skills to make the things I need from scratch so even in the worst case scenario where I get lost in the middle of a forest without anything I am certain I can build a home, make some clothes and derive chemical compounds that I can use for medicine and food, so I will have the bare minimum to survive, that is a very good place to be.

I depend on others to have a lot of things, but I don't depend so much as to get scared to death to be on my own and that is all thanks to knowledge.

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All that money you are have paid and are paying into SS is being used to pay the people currently on SS. When you reach retirement age, the money you get from SS will come from the current working class, or debt.

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There are a couple of relatively easy things that can be done to keep SS solvent, though:

1) Raise the income cap (slightly)

2) Raise the retirement age (slightly); a way to make this one more palatable is to maybe introduce some incentive to workers who decide to postpone retirement and keep contributing to SS instead of forcing everyone.

There's a very simple purpose for entitlement programs: it's the understanding that there's a social benefit (i.e. to EVERYONE) when seniors are guaranteed a minimal standard of living.

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There is something known as, long term planning. What this means is that instead of trying to live at the absolute highest life style you can afford the payments for while you work, you instead settle for something less.

This will in turn provide you with extra disposable money that you can save for when you want to stop working.

Expecting the government to provide for you because you've gone and spent every penny you could put your name too is just dumb.

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So I suppose I should get 10+ years worth of FICA taxes back to invest toward this? Never mind the fact that even if I managed to save every penny of my salary for the next 5 years, needing cancer treatment when I'm 65 (and uninsurable) would wipe that out and more. Are you a fucking imbecile or just an asshole?

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"Expecting the government to provide for you because you've gone and spent every penny you could put your name too is just dumb."

I expect the government to provide for services I have paid for - With my taxes.

"you instead settle for something less."

Welcome to America, you must be new here. We don't 'ever' choose to settle. It's what makes us the best place to live.

It's why we decided that allowing seniors to live in poverty was worth paying taxes to fund national healthcare for them. And for you as well by the way, once you get there. Or Medicaid should you be disabled, etc.

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I expect the government to provide for services I have paid for - With my taxes.

Even when those programs are unsustainable in the long run, driving your children and your children's children into more and more debt?

Why not exercise some personal responsibility and plan for your own retirement and health needs?

Welcome to America, you must be new here. We don't 'ever' choose to settle. It's what makes us the best place to live.

It is also one of the major drivers of the housing bubble, the current student loan bubble, the average $10,000 debt ber citizen, and far more problems. People spend more than they can afford, don't plan for the future, then expect someone else to pay when it all hits the fan.

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Why not exercise some personal responsibility and plan for your own retirement and health needs?

I became disabled at the age of 24. Pray tell how I could have planned for my own retirement and health needs? And how could I have even planned on needing to? See, you've got a lot of suggestions for everyone but me.

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Your argument suggests that the only reason that people are unable to cover medical bills is "lack of planning".

Sure, I have little sympathy for someone who insists on spending every last dime and expects the taxpayer to take care of him when he needs, but that's hardly the only reason why people fall through the cracks.

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And what about people like me who were suddenly disabled and unemployable? Am I to simply roll over and die because I cannot afford health insurance or health care? See, I like ideas like this, but then, you know, you're telling people to their faces they should just die. Thanks for that.

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Other responsible economies with a certain kind of problematic demographic, has already raised the age of retirement to 67.
When you say "only 2 years" it sounds like it won't give a significant boost to the available pool of workers.

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In the UK life expectancy is shifting to such an extent that, according to actuarial models*, a 3-year-old has a greater chance of reaching 100 than a 97-year-old.
According to those same models someone has already been born who will reach 125.

This is why the balance is unsustainable.

The challenge comes in that although we're living longer we're not ageing that much slower. I.e. we're prolonging the period of, for want of a better word, decreptitude where our care costs become very high.

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I agree.

I also agree generally with the list of ideas by the economists.

However. (You knew it was coming.)

The problem with both is that they seem to ignore what has actually happened. We can't ignore that SS will go broke because politicians raided it. We can't ignore that our economy is broke and there's no political will to fix it rationally.

We can have the best idea, a workable implementation of that plan, that all economists agree on - and yet it will still not be acheivable. Not because of its own flaws, but because it doesn't take into account where we're starting from. Which is with a broken economy, partisan and irrational politics, entrenched special interests, and a public with little financial and economic knowledge.

How do we get from where we are - to where we need to be? If you can't answer that, then it doesn't matter that the weather is sunny over there and storming here - you're stuck in the storm without a map and directions.

Frankly, alternative theories was beside the point. I was shocked that people were accepting "A preceded B, therefore A caused B" at face value, even calling it insightful.

At least the NBER paper is something that can actually be discussed. I can't drill down into the details of the paper at the moment, but the abstract states the following:

"The authors also find that higher benefits lead some elderly to live independently rather than with family members, and conclude that the effect of Social Security on poverty would have been even more dramatic in the absence of these changes in living arrangements."

While this is potentially an accurate reading of the data, it implies another detail - Poverty was disproportionately high for elderly households prior to SS. Most elderly individuals did not maintain their own households prior to SS. Therefore, most elderly households prior to SS were likely already in problematic situations.

In other words, for most elderly households prior to SS, living on their own was less of a choice - it was less because they wanted to support themselves, and more because they had no one to support them.

Additionally, the poverty line makes no concession for private charity. It is assumed that low income/resources = poverty and poverty = suffering. If the kindly old lady with no biological family is cared for by her church community, does she NEED a check from the government? Does it really serve that significant a purpose if she does receive that check? Is it the best way to spend taxpayer dollars?

I concede that SS has done some good for some people, and has even been a lifesaver. But you simply can not justify spending the country into crippling debt for the sake of a few human interest stories.

But overall, this claim really doesn't pass the laugh test. The 20th century has been host to one (or several) of the most dramatic economic and cultural shifts in all of human history, and you expect there to be a 1:1 correlation over 75 years between an economic policy and a particular demographic?

"Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment."

Except in the case of old age insurance provided by the government the "payment" to the provider, i.e. the government is tiny (something like .01% of money collected goes towards administering the program). However, the transfer of "risk" in this case, risk of being poor because you reached old age and didn't save enough (for whatever reason), is done by taking money from one and giving it to another.

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As I said above:

All that money you are have paid and are paying into SS is being used to pay the people currently on SS. When you reach retirement age, the money you get from SS will come from the current working class, or debt.

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Which still does not make it the fault of the people who paid in, who expect to get their money back. It's like putting your money in the bank. The bank borrows against your deposits, but you still are entitled to that money you put in.

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But wouldn't it be better to say cut you SS in half (to pay the current people that have paid in all of their lives) IF you agree to take the rest and put it in a 401K or some other private retirement plan and when you hit 65 you dont get anything....other than what YOU put away.

The basic idea is to fund the short term while phasing it out for those of us that have time to get out. It will not continue to work, and we shouldnt expect it, plus we can get better deals/return on our money outside of SS.

Plus get rid of the cap on money i can put into my 401K/roths/ and other investment devices so i can control my own future (or at least be responsible for it). The Cap is only their to control you anyway.

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So the fix is to zero out your "account" with the government and take all this money to dump into the market machines?

I am sure that it will make for plenty of wealthy fund managers who take their cuts coming and going, and some people might hold on to enough to keep earnings near inflation.. but that is all.

Later on when grandma, or your parent, or you turn to that fund you thought had been socked away for a rainy day and find the sock had a huge hole in it you will wonder why you let all the liability be shifted to you while all the profit was shifted to someone else.

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> So the fix is to zero out your "account" with the government
> and take all this money to dump into the market machines?

They could at least stop dumping everyone's money into one big pot and assign every person a separate account. The money that's taken out of my check now goes into *my* account and is available to me and only me when I retire, etc.

That way the pols couldn't keep raiding it whenever they come up short elsewhere.

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Look at your last paragraph:

"Later on when... you turn to that fund you thought had been socked away for a rainy day and find the sock had a huge hole in it you will wonder why you let all the liability be shifted to you while all the profit was shifted to someone else."

Doesn't that apply equally well to a government-managed Social Security "Trust Fund"?

SS is a ponzi scheme

Look at it. Social Security is a classic Ponzi scheme. Get everyone to give you their money for safekeeping, and use the new one's money to pay off the old ones, while getting newer ones, and more money.

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Two things:

1. Pragmatically social security does not actually work that way. It takes from you and gives to the currently retired. Those statements you get about what you paid in and what you are owed are just smoke and mirrors to cover up the fact that your money is given to someone else.

2. Let's assume it works the way you're suggesting. Why is it even necessary at all if that's how it works? Why can't individuals keep for themselves what is theirs instead of handing it to the government for decades before getting it back? Why is it unreasonable to expect individuals to save their own money for retirement instead of having the government force them to do it via taxes?

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Sorry. I fundamentally disagree with your premise. Some social programs are a necessary part of a civilized society.

True free-market libertarianism is as much a pipe dream as communism that works. They both require a reliance on the idea that humans will not screw each other over at every possible opportunity, which cannot be relied on anywhere outside of a textbook.

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Social programs may be needed, but who manages that?
Would you let the incompetency of the government manage it for you?
You know they are incompetent so why do you want them managing something so important?

Why are people not taking care of that themselves?

Social programs are social problems and should be managed and created by society not the government.

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"Social programs... should be managed and created by society not the government."

Great idea; but who has the time. I know! We'll have each region of our society select a number of its members to represent their views; we'll have just those people hammer out the details of this stuff on our behaf, so the rest of us can bet back to what we're doing.

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Basically any program that takes money from one party to simply give it to another.

So, in other words, you're against all taxation & government spending of any sort? Because all of it is taking money from one party to give it to another.

The thing about "entitlements" is that none of them are simply redistribution of wealth. All of them are done because we all benefit from their existence, whether we are on the payer or payee side of any particular equation.

A fruitful discussion could be had about whether the societal benefit is worth the cost, but I can't think of a single "entitlement" that has zero benefit to society and thus qualifies as "simply taking money from one party to give to another."

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It has to do with EU subsidies and keeping competition between US and EU farmers fair. EU will keep fighting for the subsidies because french tobacco can only survive on subsidies (oh the irony) and the newer EU-memberstates are farming countries with a big black hole for these subsidies. Another problem is the complete dependency on the subsidies created through years of abuse. I cannot see farmers subsidies subsiding significantly the next 20 or so years and even after that, we are going to see farmers with abstinences making it hard to lower dosage.

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So the US and EU get a free pass to subsidize the shit out of their own farming and screw over the entire third world in the process. Yes that is a totally rational and reasonable explanation for why such things should be allowed to continue.

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Well, virtually every justification for government,right back to Leviathan in the modern era and Republic in the classical) holds that the purpose of government is to serve the needs or desires of its citizens, so from that point of view, it is right and proper that the EU and US governments screw over everyone else if it is in their citizen's best interests.

The problem lies in reminding politicians that their citizens' interests are not congruent with their cronies' and sponsors' interests.

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I think you'll have a hard time finding anyone who really likes corn subsidies, outside of corn farmers. Absolutely, the US has become addicted to them.

Farm subsidies in general require an overhaul. One that will require cooperation with a good 60 countries. If you want the US to unilaterally rescind all its subsidies, that's a wonderfully noble effort, but you'll disrupt the tens of millions of people who depend on the various crops that are supported.

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Still see no credible evidence the HFCS is any worse for you than any other type of sugar, here. In the end, that's a health concern that's up to debate. Besides, if you're concerned about sugary drinks, then don't drink them.

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LAWL. You should research the history of farm subsidies. They were created because food prices were spiraling down, causing farmers to farm more, which was DESTROYING farm land nation wide.

"Medicaid/Medicare"
We have a moral obligation to take care of our elderly. Do you think people work for free?

"Social Security"
Yet another "lawl". People weren't saving money, they got old and had no money. Moral obligations are that we can't leave these people on the streets. Again, the money has to come from somewhere.

Ignoring these issues doesn't make them go away. They exist for very good reasons because there WAS a problem and they solved it very well.

Yes, some of their money is being miss-used, but that's a separate issue.

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You should read up on New Zealand and how it ditched its farm subsidies and now it has the best agriculture business in its entire history.

People weren't saving money, they got old and had no money.

Your lack of desire to plan for your future is not my problem.

We have a moral obligation to take care of our elderly.

Same as the above, but with the added note that it is the family's responsibility to take care of their elderly. That was something that was once a well honored tradition but has fallen away because of such programs.

Do you think people work for free?

What does that have to do with anything? I could ask you a different question:

Do you think I work for you?

If you don't learn from the past, your bound to repeat it.

Go read a history book.

I have been researching these things and have learned that personal responsibility is the best way to handle all these issues and more.

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Can you provide yourself with security and disaster response as well as your local fire and police departments? No? And even if it IS "yes", do you believe that everybody can?

So, there's a baseline of government service that most of us can likely agree on, so then it's just a matter of agreeing to draw the line.

Social Security is not insolvent, and does not have to become insolvent unless a given "side" deliberately wants to drive it there to prove a point. Giving seniors a baseline standard of living is a humane thing to do, and all of society benefits from it.

Education is a little trickier, but I'm pretty sure we can still all agree that there's a baseline level of literacy that society as a whole benefits from.

I don't agree with every single program and subsidy, either, but I don't want to see muscle cut along with the fat.

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We pay others to provide things we cannot provide ourselves all the time. There's no reason to immediately jump past that to 'paying' the government to do it.

"Giving seniors a baseline standard of living is a humane thing to do, and all of society benefits from it."

As far as it being the humane thing to do while that's true it doesn't automatically argue for government intervention as much as it argues for humanitarian causes. I don't know if you've noticed or not but non-government entities are perfectly capable of being humanitarian. I'd say the government is actually pretty bad at being humane. As far as everyone benefiting: [Citation Needed].

The problem with state run education is that the state is excessively bad at running education and that fact is very well documented.

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actually this isnt true, the problem comes in from the fact that there is less money put into education then there was when we had an education system that was the envy of the world(and yes at one time we did have such a public education system)

and by less money I dont mean dollars but what those dollars are worth, inflation has made money worth less and less as im sure you know.

teaches shouldnt have to spend a large chunk of their pay checks to buy supplies for class, but they do, I say this as somebody whos father was a teacher(Still works in education)...

as to social security, I love how people like the above say its an entitlement.....despite the fact that your just getting ur own money back...I happen to think its a good thing that people are forced into saving in this case, It has fixed many of our societies problems honestly.

I notice that everybody who is pushing these programs always complains that they are being forced to work for other people.....yet the same people dont see the problem when they benefit from tax funded systems....

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"I have been researching these things and have learned that personal responsibility is the best way to handle all these issues and more."

The problem is that no one is an island. Your "personal responsibility" could easily evaporate with about three pieces of bad luck:

1) Company/industry decides to outsource/replace/eliminate your job.
2) Bank or financial institution with all of your savings goes bankrupt due to mismanagement and deregulation, speculation in bad investments, or at worse, a crash in the economy.
3) Illness or accident, fire, flood, or other natural disaster.

All of which, you may notice, are completely and totally of your control. Now, without unemployment, SS, Medicare, and other programs, you and your family are on the street and starving (and you, if the illness is bad enough, are dying).

And some other asshole is walking by and ignoring you and your cup because, in his opinion, "you should have planned better."

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Umm... He could buy insurance against (3), diversify his investments against (2), and if he's been doing anything close to prudent saving, his family will not be "on the street and starving" if he loses his job (1), even without unemployment benefits.

Putting him in that state would most likely require a nationwide (or worldwide) disaster that would put an immediate end to "unemployment, SS, Medicare, and other programs", and it's unlikely that anyone walking by would be in a position to support his family on a charitable impulse.

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Not always possible. You're falling into the same 'should have planned better' trap. I am in that state, and it happened at an early enough age that all the financial planning and insurance in the world would not have been enough. Do you know how much hemodialysis costs a month? No? Let me enlighten you, then. Mine is fairly cheep at $18k to $22k per month.

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ah but, the likes of Mitt roMoney dont work and still make over 55k a day, infact he brags about it and the fact he pays less taxes a year then people who make 50k a year.....yes people who make in a year what he makes in a day sitting on his arse doing nothing pay more taxes then he does....

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Re: Hmmm

That probably isn't on the list because their "broad range of political backgrounds" economists don't agree on it. The things on this list are things that shouldn't be controversial. Our level of military intervention in the rest of the world has always been controversial.

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Also, ending the "war" on marijuana might save enough money all by itself to eliminate the need for the income tax. After all, we're not just fighting the "enemy" in that "war," we're then providing them all with room and board after they've lost a battle....only to set them free to fight in more battles. If that's not the definition of a war you can't win, I don't know what is.

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Consider though that once it is legalized, in addition to all of the saving from not needing to spend on what you've already mentioned, that it will also generate considerable tax income on it's own. It may not be enough to replace income tax by itself, but it's net effect will much much higher than simply what would be saved from no longer having to enforce the restrictions.

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housing potheads costs between 25k and 40k a year each, muliply that by the number of non-violent drug offenders we have in prison in this country, then try and tell me it wouldnt save a hell of alot of money to just let them out....hell you could give them all foodstamps and let them live on somebodies couch and it would still save huge ammounts of money....

I cant remember the figures but the amound we would save each year was enough to cover creating a true NHS for this country and have money left over...it was an insane amount of money wasted on people who at worst harmed themselves by doing drugs....(and in the case of pot, thats even debateable)

Ok - I'm confused.

Granted I've only done highschool level Economy, but how does cutting corporate income tax help anyone? Small businesses may reinvest income into the business, but large companies invest into into CEO retirement funds.

And while cutting personal income tax looks nice on the surface, it does have me scratching my head on how this is good for society in general.

Re: Ok - I'm confused.

And while cutting personal income tax looks nice on the surface, it does have me scratching my head on how this is good for society in general.

You missed the second half of that proposal. We are not getting rid of a tax source, but replacing it with one that has less of a negative impact on the economy.

how does cutting corporate income tax help anyone?

Small businesses employ far more people in aggregate than all the fortune 500 companies combined. By leaving more money in the pockets of small businesses, you leave them more room to expand, higher new people, provide new services etc. By taking money away from them, you artificially restrict their ability to grow and adapt to changes in the market place. More growth means more income and more money to spend, fueling the alternate tax source noted above.

Re: Re: Re: Re: Ok - I'm confused.

Not to mention the large corps have off-shore tax havens and aren't paying much taxes if any at all. I doubt many small businesses do that. So we've set up this wonderful progressive tax system that hurts the small businesses and hardly touches the large corps.

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Well *that* can be fixed by defining away the offshore tax havens. It's actually quite simple:

All US corporate tax shall be assessed on US profits, which are defined as all revenue received from sources inside the US, minus all money paid to sources inside the US. Sending money outside of the US shall not affect the company's US tax burden in any way, though it would qualify as "money received from sources inside the US" on the recipient's end.

Re: Re: Re: Re: Re: Re: Ok - I'm confused.

But what if a company buys 10 plastic bags from their Cayman Island branch for 10 million dollars? That is definately fraud. But what if the company only manufactors wheels in China and lights in Ukraine. How do you judge, what is a reasonable prize for those products, most of which does not have any retail equivalent? That is how they use the system at the moment. Having to pay taxes twice or thrice, might tick some companies off and make them leave the country and then you are really hurting the economy. You will most likely see offshore tax havens explode if you start the multitaxing scheme.

Re: Re: Re: Ok - I'm confused.

Re: Re: Re: Re: Ok - I'm confused.

The official designation of what is a small business corporation is from the IRS, and they define it, essentially, as meaning that there are fewer than 75 shareholders.

However, there are a lot of IRS regulations that use a special definition of "small business" that gauges by the number of employees. The exact number depends on the regulation, but 500 is fairly typical.

Re: Re: Ok - I'm confused.

Could it be possible then to structure a progressive corporate income tax then? I'm (very naively, mind you) thinking of a system where small businesses which anyway would be more likely to actively grow by investing rather than putting corporate income into executives' paychecks would pay very little to no tax, while larger corporations would pay more taxes for the opposite reason.

Re: Re: Re: Ok - I'm confused.

The problem here is believing small business will invest in people, whether more of them or pay them better. My wife and I have worked for several small businesses between the two of us and only 1 has payed better than the market rate. Any extra money they have from not paying taxes will go into their BMWs, waterfront homes and vacation condos. It sounds good in theory but not sure this one works in real life.

Re: Re: Re: Ok - I'm confused.

"...while larger corporations would pay more taxes for the opposite reason."

They don't pay now, why would they pay more? The money you think you are going to tax will be spent on upper management salaries and bonuses even more than they are now just as a way of avoiding the tax.

Re: Re: Re: Re: Re: Ok - I'm confused.

Re: Re: Ok - I'm confused.

Currently not all 'Small' businesses are corporations... BUT almost all fortune 500 companies are, so this is really designed to benefit the 'big guys' more than the small businesses..

Although with this type of change, I could see all small businesses opting for the additional cost and paperwork to incorporate, as long as the tax savings exceeds the costs (roughly $500 upfront and a couple hundred a year last time I checked, to incorporate in NV from any state...)

Re: Re: Ok - I'm confused.

"Small businesses employ far more people in aggregate than all the fortune 500 companies combined."

Only if you consider all individuals who file for incorporation and operate as solo businesses.
If you go with only businesses that hire more than the individual who founded/runs the company, the total workforce is less than major corporations.

Re: Ok - I'm confused.

I actually have a similar issue with that, and I've taken two semesters of introductory college economics (microeconomics and macroeconomics). It sounds good on paper that cutting corporate income taxes will induce business investment, it sounds a whole lot more like the voodoo economics of the 1980s; to me it seems like the abolition of corporate income taxes should be coupled with strong other non-tax incentives to actually invest corporate income in business ventures, or else said corporate income will simply go into the pocketbooks of corporations. This is also why subsidizing firms in a market to increase production to match a positive externality won't work. Taxing firms to match a negative externality will cause production and possibly the number of firms to decrease, and prices will increase. Subsidizing them, though, will not decrease prices or increase the number of firms, because firms would rather hang on to their greater market power and higher prices while eating the subsidy themselves; the only way for this to change is for another firm to essentially cheat at the game and drop prices to marginal cost with the subsidy, but that is far from guaranteed.

Income tax exists only because it is so far the only palatable and simple way to enact progressive taxation. I would be fine with replacing income taxes with other taxes (e.g. consumption taxes, as mentioned in the article) that are structured to be progressive, but those economists had better have a damn good idea of how to make other taxes progressive given that almost all taxes other than those on income are inherently regressive. Why is this so? It's because poor people spend a larger percentage of their income through consumption than rich people do, so they would get hit harder with consumption taxes; again, there had better be a good, solid way to make such a regressive taxation system progressive.

I would mostly agree with the other suggestions though. They seem quite reasonable, so I think they're just nonstarters *within Congress*.

Re: Ok - I'm confused.

The devil (angel?) is in the details. They'd cut corporate taxes, sure, but you'd also eliminate the special handling of capital gains, which exist now because people say corporate income shouldn't be taxed twice; once as corporate income and once as personal.

And you don't _just_ eliminate income taxes; you replace them with consumption taxes; in effect, that means all current tax deductions get replaced with a single deduction for the money you save (because income - consumption = savings.) And you do it at a very progressive rate; it's possible, depending on those devilish details, that your example-CEO ends up paying a lot more in taxes than under the existing setup.

Re: Re: Re: Ok - I'm confused.

Huh? I don't get your logic. The officers of the corporation are individuals who, if you will, get the liability protection and who pay taxes. The corporation itself is still liable - not protected.Your "logic" is that the corporation (which is NOT getting the benefit you mentioned) should pay taxes because of the benefit -- that it doesn't get.I think YOU are confused.

Re: Ok - I'm confused.

Corporate income tax, especially a tax that is higher than most other countries, encourages corporations to realize their income in other countries and engage in other unproductive accounting maneuvers in order to avoid the tax. If the income could be brought to the U.S. it could be used to expand operations here, distributed to shareholders, or yes, boost CEO pay. If you leave out issues of equality and fairness, the last option is still preferable because it increases U.S. economic activity instead of non-U.S. activity.

Economists generally favor a consumption tax versus a revenue equivalent income tax because economic theory says that income tax should decrease the total amount of income in an economy and a consumption tax should decrease consumption and increase saving and investment. Increased saving should increase the supply of money available to borrow, which should lead to lower interest rates, which should lead to economic growth as people borrow money in order to start and expand businesses. Notice all of the "shoulds" in that sequence, as a great many things happen in the real world that disrupt the theory.

Re: Re: Ok - I'm confused.

More or less agree, but I just wanted to point out that while the US headline corporate tax is high, the effective rate paid by US corporations is very low, because of all the tax deductions in our code. (You may already know this, just pointing it out for those following along.)

Re: Re: Re: Re: Ok - I'm confused.

But on the same idea, right now Americans spend, and they spend alot, so cutting income tax, and putting consumption in place would free up extra money for each person every pay day, now history would say most of those Americans go and spend the money, increasing activity in the market, this is where a should comes in, because its not been done. but factors and history are on its side

(products price should go down long term as the corps and business see increased earnings but even if they stay the same the consumper at home has more money to do with as they please)...

My thoughts are basically:
" Yup, we have not done it yet, it will not work as predicted (never does) but what we have now doesnt work for crap (current tax system) either and we have bandaided it to the point of stupid.
Lets give it a roll and see what happens, because right now we are screwed, this way we might not be screwed and nobody has yet to point out the fatale flaw, and no matter what people end up with more money every check"

Re: Re: Re: Ok - I'm confused.

Not necessarily. If consumption is less but savings are more there is still, basically, the same benefit to the economy.I, for one, think this society could do with a lot less consumption. You don't need a new car every year or the latest and greatest gadget every month.

Re: Ok - I'm confused.

me too...
from this cursory summary, it appears the only tax left is one on -essentially- energy consumption ?
i don't know...
AND, i REALLY don't get the 'no corporate tax' idea AT ALL... (nor the no individual income tax, at that)
while -if i were king of amerika- i would slash the budget more than most (including 50-90% of our military industrial komplex budget), we still have to raise monies for some stuff... i am skeptical a mere energy tax would do it...

having just listened to another 'alternate economist' (of sorts, Richard Wolff) talk about how our korporate tax is W-A-Y skewed from what it once was, i'm just not seeing the no corporate tax angle... up until about the 50's-60's, for every dollar in taxes an individual paid, korporations paid a dollar fifty; *NOW*, for every dollar an individual pays, korporations pay 25 cents...
*some* (fictitious legal entities) are NOT paying their fair share anymore, on many levels...
they socialize their costs, and privatize their profits, and we 99% are left holding the bag...
just don't see how letting korporations off with ZERO tax is either fair or possible...
art guerrilla
aka ann archy
eof

regarding 2 of the proposals

Proposal #4 is good. Many of us libertarians have wanted to repeal the 16th Amendment and pass in its place the FairTax Act of 2005. It is "progressive" enough to have a poverty-level prebate to assist those below the poverty level.

However, I highly doubt that most sane economists agree in support of Proposal #5. Taxing our current life blood (fossil fuels) with no reasonable alternative currently in place slows down economies, causes prices for everything to rise (as logistics requires fuel to transport goods manufacturer to reseller), and makes less money available for buying goods and services in general considering how much we use on a daily basis.

Re: regarding 2 of the proposals

Even the libertarian on the panel reluctantly agreed that fossil fuels should be taxed (his reluctance stemmed from the fact that it should be an international policy to be effective, not a national policy). Fossil fuels already have an incredibly high cost. The problem is that the cost is spread out amongst everyone and only felt over a great amount of time. In the short run, it doesn't make economic sense NOT to pollute.

Re: regarding 2 of the proposals

> Taxing our current life blood (fossil fuels) with no reasonable alternative currently in place

Right now, the solution seems to be subsidize alternative energy sources. We all know how well that worked. Many alternative energy companies that Obama invested in are busto.

If we truly believe that cutting fossil fuel emissions is required, then the only sane solution is to tax carbon. Then alternative fuels that work will rise to the top. Leave the business of figuring out what is going to replace fossil fuels to businesses, not governments.

Re: Re: Re: regarding 2 of the proposals

> So no, we didn't do *enough* subsidy.

What? So the government tries to pick winners in the alternative fuel race, picks wrong, and you think we should have doubled-down? How about we let the market sort it out? Or should we go back to having committees decide the price of bread tomorrow?

Letting businesses do the 'investment' is win-win. Tax money doesn't go to politicians' pet projects (ethanol?!?), and the people who actually know what hell is going on (e.g., engineers) lead the charge.

Re: Re: Re: regarding 2 of the proposals

The flat tax component of the FairTax is significantly lower than the current top marginal tax rate, so in the limit, as the low-end "prebate" becomes less meaningful as a percentage of spending (and in practicality, above the 97th percentile or so) the actual tax burden on the rich is lower.

Re: Re: Re: Re: regarding 2 of the proposals

Only if you engage in typical middle income consumerism. In which case, yes, you might. But the fair tax puts the amount of tax you want to pay in YOUR HANDS. Controllable by you. If you don't want to pay a tax, screw em, buy used.

Re:

I can see how one could argue a sales tax only system hurts poor. I personally think there are ways to put such a system in place that will account for that.

For example, no sales tax on food, and by food I mean real food, tax candy and junk. By selecting certain things to be tax free you are able to actually keep cost of living very low while getting tax money off of things that are not needed for survival.

Re:

Not saying I am fully in support of this, but it is a possible solution, but the Fair Tax is proposed along with a "prebate" system in which everyone gets a certain amount of tax free purchasing each month/year to limit the negative impact on the poor.

Re: Re:

so, your one of the people who think the poor and disabled such as myself(cant work a real job anymore due to health) should just "hurry up and die" because social security and medicare/medicaid are in your eyes evil entitlements that take your money and give it to people like myself....

good to know....

to anybody who really feels I and those in my possition should just "hurry up and die" I have one thing to say
Go F*ck yourselfs, just because I cant work dosnt mean im not able to contribute to society and dosnt mean I shouldnt be able to live....

Re: Re: Re: Re: Re:

Re: Re: Re: Re:

as stated by the AC, without some form of income and medical care, how are people like myself to survive?

I wish I wasnt crippled by severe debilitating arthritis, I wish that I didnt have regular flareups that put me into a wheel chair for days or even weeks at a time.

hell sometimes I cant even type, when its bad enough my elbo/wrist and hand become involved....so much so that i cant even pull up my own pants.....

even with medical care and treatment this isnt going to go back to being "normal"(i wish it was)

the attitude I take from people saying we need to remove all forms of social systems like medicare/medicaid/ssd/ssi is that they would prefer people like myself to just crawl off and die because, after all, we are useless to this capitalistic society.

hell, im so stove up most of the time I couldnt even sit on a street corner and pan handle.....

and the republican/conservative/capitalist libertarian view is that people like myself need to hurry up and die as to nolonger be a burden on society, if it wasnt, they wouldnt be constantly trying to destroy the services we are forced to rely on to survive.

also a note: none of the cheap treatments work to manage my condition, I am stuck on humaria, a bi-weekly injection thats very expencive, it keeps it from being quite as sever when I have a flare(i nolonger endup in bed for a month or more at a time due to inflammation so bad both of my knees swell so i cant walk, but I still have to be extremely careful, walking up and down a flight of stairs can set off a flare that ends up with me in a wheel chair for a week....)

Re: Re: Re: Re: Re:

Just as a thought experiment, let's suppose it comes down to you and me. All the people earning money and all those who can't survive without support have paired off, and my taxes are keeping you alive.

Now I have a choice between earning a bare living as an artist and earning five times as much working 8:00-8:00 in an office. I'll get to keep roughly the same amount in either case, but only on plan B will you survive. I want to be an artist; that's what I want to do with my life.

Then are you willing to say "your life is your own and my illness is mine and your obligation to me is at an end"?

Re: Re: Re: Re: Re: Re:

I'll go with that, with one proviso: If you're not willing to pay to help keep a fellow human being alive, then you personally have to take the knife, stab him in the guts, and watch his face as he dies in your arms.

People are all too willing to inflict pain, suffering, and hardship on someone else, just as long as that other person has the grace to die quietly, out of sight, and out of mind.

Re: double standard

if you feel that a small % of your income/tax dollars used to help the disabled is ruining your life I welcome you to come and end my life, if that will make your life better in some way, please, feel free to stab me, shoot me, slit my thought, whatever works best for you.....

My view always has been that when I was able to work a % of the taxes I paid went to help those who coudnt fend for themselves, I kept in mind that, someday I could endup like them(sadly I did...)

I also must ask, why is it that you have such a problem with helping the disabled but your not railing against supporting all the non-violent drug offenders that are in prisons for stuff like possession of pot?

just wondering, since I dont cost the govt even close to the ammount each prisoner costs(shit I would love to have what it costs to house the average pothead in prison each year....hell with that money I could probably afford to get better care and possibly even be able to go back to some form of work part time(already accepted that im never gonna be 100% again...to many doctors agree...im fucked...)

I do my best to contribute to society, I try and help others at every chance I get, the other day i spent a full day helping somebody with their pc, I couldnt do the work myself (couldnt use my left arm/hand properly) but i did my best to help him get his system working again.....he couldnt afford to pay me much(15bucks was all he had...and honestly i felt bad taking it but he insisted)...

But if my life and the meagre medical care and food stamps I get(still fighting to get disability) are ruining your life and making you my slave, Honestly, Please come kill me....if it will make your life better I will happily allow you to do whatever it takes to fix the problem.

Re: Re: double standard

Apparently you didn't read what I wrote about the thought experiment. And killing you was Michael Long's idea, not mine. And I am very much opposed to the drug war and idiotic policies like mandatory minimum sentences for possession of marijuana, but that really isn't relevant. And actually I do go out of my way to help disabled people -- taking great care not to rob them of their dignity in the process.

In fact I am so mindful of the dignity of disabled people, that I will not do you the injustice of pardoning the flaws in your reasoning out of cloying sympathy. You haven't bothered to use your brain in this discussion, even to use correct punctuation or keep track of who said what, your arguments alternate between arrogant entitlement and disgusting self-pity, and the less said about your attempts at logic the better. If you've shown us a fair sample of your thinking, then even if you were magically healed of your physical maladies this very day and given the physique of an olympic athlete, you still wouldn't be good for much but lifting heavy things. If your wits are all that nature has left you, then for heaven's sake, man, learn to use them better!

Re: Re: Re: double standard

If you are going to make these sorts of accusations, and I might add that the way you delivered it was troll-worthy, than might you be willing to show what you think falls into these categories? I, too, am on permanent disability due to illness when I was in my early 20s.

I see you accuse him of not using his mind when you fail to realize just how debilitating some forms of arthritis are. When you are in pain, you cannot think clearly, which means you cannot work efficiently. What job, then, would you say he is good for? Or myself, for that matter? I'm still looking for ways I can go back to school and work, again, but guess what that requires? Those social systems that you seem to be so against!

Re: Re: Re: Re: double standard

I decided not to respond to the trollish post above yours AC, but I feel I should respond to your post.

Those who have not had arthritis cant understand what its like, they dont want to, I wouldnt wish this on anybody, ever, its funny how according to the trollish post above I am an idiot....yet whenever I have had an IQ test its come out in the genius range.....

just because you dont agree with somebodies opinion dosnt make them an idiot, despite what some would like to believe.

I understand the haters point of view, I get that they where raised to think of themselves first and everybody else second, Hell I happen to have a few close friends who I grew up with who where raised in such families(always right wing funny enough), some of them have remained the "fuck social programs" types, but most have changed their tunes, a few thanks to watching me try and function and do my best to not go on the dole.....

let me explain something for those reading this, All my problems started medically at 23, im now 32/33, Till the last 2 years I struggled very hard to not rely on the govt, but it finely got to the point where I was down more then I was up.

during accute extreme flares (what happens without the expencive meds) I have a running cycle of aprox 90days between major flares, the problem is that a major flare can take 60+days to recover from, when I finely gave in was after I had been unable to even get to the toilet (couldnt get out of bed) for 2 weeks, and had not gotten any real sleep for a week....both of my knees where so swollen that i could neither straiten nor bend them(anybody whos messed up a knee knows what i mean)

the doctor at the emergency room told me I should apply for disability, as had others but, he said that IF i could get proper treatment, at least there was a chance that i could get some normality back to my life.....

so I applied for state medical and also got a doctor at seamar to help me get in to see a specialist via project access, the specialist gave me the diagnosis I had already come to myself, Psoriatic arthritis, he told me till i got some sort of medical coverage the best he could do was give me some nsaids(couldnt even prescribe pain pills, they arent allowed to do that, you have to see a pain doctor)

well after getting his report and diagnosis I managed to get state medical.....

after that it took a few months but they got me on a treatment plan that had humaria in it, since then things have been better, well till i got knocked off state medical due to a review issue....(they wanted a review every 60days, but I could only get in to see my primary care for a review every 90days...due to the fact that I was forced to use seamar clinic and the doctors there are overloaded)

I got back on less then a month after being dropped thanks to the doctor getting the review in quickly, but it took 4 months to get my humaria back...in that time, i went from being able to function at around 30% of normal, to less then 5%.....so bad I started keeping a pee jug next to my bed because walking to the toilet in the middle of the night was risky...(one bad step and i endup ina wheel chair)

when I got back on tho, I was at their highest tier rather then a middle tier, they are helping me get disability...but still....as I learned, without the dugs, i just cant function... the least of the symptoms of this is the fact that your body hurts all over, all the time, a dull ache, even on the medications, flareups are like somebody injected your joints with acid.....

I wish I didnt have to rely on others...but....I do....some of whom like beta apparently would like to cut my throat...if that would make their lives better, they are welcome to come over and do it.....

Re: Re: Re: Re: Re:

I absolutely agree with people that the government should not be responsible for entitlement programs.

a) Taking care of that and monitoring it becomes impossible, if you are the judge, jury and enforcement you will never be able to be honest.

b) Giving the government the responsibility for entitlement programs is giving the government the power to decide what they will do not you and you will get screwed just like the SS is bankrupt and medicare/medicaid don't work and keep increasing the cost of it.

The solution?

Build your own safety net, not alone but not from the government either, cooperatives are a form that is proven, just like unions charge their members and save millions as a cushion for when their members are called to strike, what is stopping people from doing it themselves?
Then the only thing the government would be doing is keeping and eye to make sure those "cooperatives" are not being robbed by dishonest people.

You are screwed already you let those people own you, will you let them own your children too?

The most important thing you should be doing right now is learning and developing useful skills that you can teach your children so they are not hostages to entitlement programs.

The thing I don't get is that people know for a fact that the government is incompetent to manage such initiatives why you people want to make them continue to do so?

Re: Re:

My husband and I are big supporters of the Fair Tax. It makes sure that everyone sees a "prebate" and encourages those who benefit from government largess are covered and the load isn't shifted to the middle class. We then get a national sales tax on NEW purchases, so the sale of used furniture, cars, etc. would see a big boost and have more value, something that should please environmentalists.

The problem this this? It shifts power back to the voters and awaay from the politicians. And they'd go right back to their fee vs. tax games in order to keep their lucrative backroom deals and party invitations.

Re: Re: Re:

There's a variety of problems with any kind of consumption tax that's large enough to replace income taxes.

First, fraud. To completely replace income taxes, a national sales tax would likely need to be around 15% (and likely higher than that if staple foods and such are exempted). There's tremendous incentive to smuggle and work "under the table"

Second, fairness, the term "Fair Tax" notwithstanding. Inevitably, there's a call for exemptions, and no matter where you draw the line, you wind up with ridiculous situations (in Canada, a single donut gets taxed, but a package of 12 is considered a grocery item and are not). These exemptions inevitably become a political football all their own.

Flat tax doesn't work either, by the way. The middle class assumes a massive chunk of the burden.

Re: Re: Re:

Report what you earn. Report what you consume (or alternately, what you save; income = consumption + savings) and tax it, on a progressive schedule, like we do now with income. It works out the same as the income tax, but the only deduction is for savings.

Re: Re: Re:

When use with government endorsed receipt system (Shops buy these receipts at the price of equivalent current consumption tax. Purchasers must use these receipts in order to claim money for those PO. Each of these receipt have expiry date printed on it. The shops can redeem new "receipts" with expired ones after paying the difference of consumption tax between these years.), the use of black market to escape tax can be reduced. (Either they use official receipts so they pay the tax anyway, or don't use receipt so cannot claim fees from company fund.

Re:

A progressive sales tax should be fairly easy. Simply tax at different rates depending on what is being purchased and how much it costs. Though I could see BMW dealerships selling their cars as individual car parts with separate purchases, one of those purchases being "assembly".

The proposals are amusing because they appear to be mostly one sided, and rather too close to the old Reaganomics / Voodoo Economics theories: Don't tax the rich and those making the big money, and hope it trickles down into the economy (and it didn't... Bush Sr had to raise taxes to pay for this stupidity).

These things aren't "political suicide", they are just not supportable. You need to say "if you cut the corporate tax, which brings in X billions each year, you will replace it with X billions of new tax income from Y, or you will cut Z program". Just saying "do this" is kind of meaningless.

However, it does explain a lot about you Mike, and your seeming unwillingness to understand the implications of changes in business models or economic policies. You never look at the full effect, you only focus narrowly on one side .

Oh, and the economists would do better looking at the entitlement side of things, where 50% or more of the typical tax dollar is spent on things that the government cannot easily change without taking away someone's direct entitlements / benefits. That is the true issue of the US (and many other countries).

Re: Re:

Yes, but they are one sided summaries, with no indication of their true effects. It's "jump in front of the speeding train" stuff without any explanation as to how you avoid getting splattered.

I don't expect step by step, but "repeal corporate taxes, that Means X billions less income, but we feel it will be offset by more spending by corporations and more money being left in the US rather than sent offshore, potentially increasing employment". At least then we have some way to understand. This is just "crack egg, enjoy omelet" without talking about cooking.

Re: Re: Re:

I really don't think these economists are basing these policies one warm fuzzies, but rather on the long term national impact. No sane economist would think so shortsightedly. But if you actually listened to the whole show, not just reading Mike's abridgment of it, then you might get some of that context you crave.

Re: Re: Re:

You missed the point where the libertarian economist (reluctantly) agreed that these were all part of a viable solution to the US' Economic issues, right?

Also, you are aware of just how much is spent on enforcement of marijuana and cannabinols? Currently, it's at a good many hundreds of billions of dollars. These aren't the be-all and end-all of solutions, but these are genuine solutions that no-one wants to attempt, because of the political climate.

Re: Re: Re:

The economists all agree that corporate income taxes cause real problems. They likely have different views on the specific implementation and replacement methods, but the common ground is that corporate taxes cause distortions that are bad for public policy. But, of course, this can't even be discussed because even mentioning it is countered with such revulsion. Everyone feels that "corporations" should pay taxes. But whether you believe a corporation is a person or not, you must realize that it is people that pay the taxes.

We never pretend that property taxes are anything but a tax on the person who owns the property, so why do we pretend that the corporation pays its own taxes?

Economists still debate about who pays how much of the corporate taxes, but most economists believe that the OWNERS of the capital are likely paying less than half. What is generally agreed on is that corporate taxes raise the cost of capital which drives it to non-corporate or tax-exempt sectors. Corporate taxes result in lower rates of return for ALL owners of capital. It discourages corporate structure for no good reason, and it encourages debt (interest payments are deductible) over equity (dividends are not deductible). These are all distortions that do not serve any public policy goals.

However, it's this hidden and misunderstood nature of corporate taxation that makes it so easy to hang onto. If we don't know who's paying it, everyone seems to believe that they aren't paying it and only some rich guy is.

Re: Re: Re: Re:

Yes, but the effects of eliminating corporate taxes would be to create a new dodge to avoid personal taxes on the amounts: offshore holding companies. Basically, you let the corporation be all profitable and happy, and have all the major shareholder be offshore trusts and such. Pay a huge dividend, and the money all disappears outside of the US pretty quickly, coming back in a ways that again avoid taxation on a personal level.

Corporate taxes are a negative in general, but eliminating them in and of themselves won't really solve anything - it will just allow the rich (people and corporate investment groups) to get richer, and give more incentive to move that money offshore once it's made.

Re: Re: Re: Re: Re:

That is why it makes sense to convert from an income tax to a consumption tax at the same time. Rich people still spend money to consume things and they do it at a much greater level than poor people. If both these things were implemented, the traditional tax haven would be non-existent, because there would be no taxes to hide your money from, the only way not to get taxed is not to spend it.

Re: Re: Re: Re: Re: Re:

Consumption taxes are just another thing that corporations can easily dodge. As an example, rather than buying machinery or computers in the US, they have their offshore subsidiary buy them outside of the US, and then LEASE them to the US company, specifically avoiding a consumption tax on the full value.

Re: Start with a false premise.

They are only unreasonable because of the massive bloated spending regime the Federal government has established. If we were to actually reduce the size and scope of the Federal government to what is outlined in the US Constitution, then these proposals would make sense. As it stands right now, with so many people and organizations dependent on the Federal government for handouts, we will never be able to implement these proposals. That is what makes these proposals political suicide.

Re: Re: Start with a false premise.

Disagree.

You can improve the tax structure (change revenue) regardless of how you spend it. And since there are no spending-side suggestions in this list, I take that to mean that there are no spending-side suggestions that 5 prominent economist can agree on. These points can "make sense" without any spending changes.

Re: Re: Start with a false premise.

Very wrong. These proposals (3 and 4) are wrong because they only address economic ideals, not political realities.

The political reality is, the more you concentrate wealth, the closer you get to despotism. Or to put it another way: would corporations spend their money on making their business better (reinvesting) or making other businesses worse (lobbying, patents, etc.) I think we've already seen which one they prefer. It's a zero sum game to them.

We've already seen that when corporations change heads, they can turn on a dime and make everyone's lives miserable. (Sun, anyone?) Now give that corporation an even larger chunk of money.

We need a mechanism to strip away the inordinate amounts of wealth accumulated by generations of the elites. Some, like Gates and Buffet, have pledged to give their fortunes away, but others will certainly pass their wealth down forever. Has it occured to anyone that what made America great was that we didn't have the generations of wealthy aristocrats wielding inordinate amounts of power? How about now?

Re: Re: Re: Start with a false premise.

I do have a crazy idea for that, and I am sure that it has been suggested before. I know it would take some working to make it work right but I would support a 100% Death tax along with some sort of inheritance disbursement when you turn 18. Essentially, everyone starts adult life on the same footing instead of it being luck of the draw.

There would have to be some other policies to go along with this I am sure.

Re: Re: Re: Re: Start with a false premise.

That's a good start... but corporations are immortal.
Give corporations a lifespan, say 120 years, and we're in a much better place.
We would also need to make sure that any one person could only sit on a single board of directors, and that person could not be an executive of any level at any corporation.

Right now we have CEO's of one corporation sitting on the board of 5 other corporations. How is that not an unfair concentration of power?

Re: Re: Re: Re: Start with a false premise.

Policies like illegalizing possesion of money by a minor. Or possibly giving gifts to one's children. Which would be a pain to enforce, on the order of the war on drugs.

The other possibility is separating parents and children at birth which, however good such an idea might be, goes againt the whole culture which views parent-child relationships being among the most important relationships a person can have.

Re: Re: Re: Re: Start with a false premise.

It has been suggested before, and it has a beautiful symmetry, but the consequences for the economy would be disastrous. People like to invest for their children's futures, but not many would be willing to build a fortune just to hand it over to the government. Instead most people would spend whatever they accumulated on luxuries and entertainment, earn no more than was necessary to maintain their own lifestyles, put nothing into long-term capital investment, and aim to die broke.

Re: Re: Re: Re: Re: Start with a false premise.

So, you can invest in you child's future, but you don't want them to get the money until you die? That makes sense. You are able to give a one-time, tax free gift to anyone you want, and yet you bitch about an inheritance tax?

Whoa...

Seems like some of these are right out of the current GOP play book. Cutting corporate income tax and personal income tax is right up their alley. And how would we make up for the absolutely huge amount of revenue lost?

Re: Re: Whoa...

Re: Re: Re: Whoa...

It worked great for Chile which eliminated their public pension system in favor of a private pension system. It worked great for New Zealand which eliminated its farm subsidy program and ended up with a far stronger agricultural economy and exports. It could work in a number of other areas as well.

Of course this is all still ignoring the fact that the states would be able to pick up where they feel they need to.

Re: Re: Re: Whoa...

The PIGS are in trouble because they spend more than they earn. Of course the public doesn't like reining in spending. I, too, would like to retire at 50 with a full pension.

The nice thing is they will get austerity whether they like it or not. Either they tighten their belt to receive bailout funds, or they don't and go broke. Frankly, I think they should give the bird to German banks and just go bankrupt and leave the Euro. This is what Iceland did. But they may be info a few years of hyperinflation while their currencies get back on their feet.

Re: Re: Re: Re: Whoa...

"The PIGS are in trouble because they spend more than they earn."

No.

In Greece, yes, but Greece is not all four nations. Spain and Ireland were in fact doing everything "right" before the crash. Their problem was a major housing bubble. (Like the US had. But since there's no Fannie/Freddie for the right-wing to pin the blame on, they just paint them with the same brush as Greece and hope no one will notice.)

different economies

It's not the hawks who are keeping military spending high, it's the defense industries.

Imagine you're a member of Congress considering a new defense contract for a new submarine or something. If it means jobs in your state, intellectually lazy voters will love you for it, even if the submarine isn't worth the cost -- which will be borne by the whole country, not just your state. They won't think through the consequences of many states playing the same game, making everyone poorer. That's why a new military system tends to have different components manufactured all over the map; it's not because the machinists in those land-locked states are particularly good at making submarine parts, it's just that everyone in Congress who supports the appropriation wants voter support in return. The same goes for recruitment, training, stationing-- from the point of view of the people making the decisions, the money spent isn't a cost, it's a benefit.

Re: Whoa...

A consumption tax, essentially a federal sales tax. It says it at the end of making a point. It would probably need to be in the 15-20% range, although I am not an economist so that is a guess, but if you were not paying income tax the price jump would not effect your standard of living at all and you would not have to "do your taxes" every year. This would result in people paying taxed on how much they spend instead of how much they make. There are some logistical hurdles, such as, what if everyone saves among others? But that would be a good thing overall as if everyone increased savings then that would reduce the need for social security which would pump more money into the consumer economy to be saved or spent (ie taxed) and then would strengthen the economy even more. Not to say that there would not be issues to address, but it is an idea that has been supported by pure economists (with little or no political leanings) for years at least.

Re: Re: Re: Whoa...

Re: Re: Re: Whoa...

Even without calculating I believe that that does not make sense. What you are saying is that Americans, long known as the biggest consumers in the world, pay a level of income tax equal to half of their consumption. I do not think that that is the case. Just look at your own paycheck, see how much they take out of your paycheck for federal income tax in a month, then compare that to how much you spend in a month. For the 50% consumption tax to make sense your tax would have to be half your spending.

Before I get destroyed for this analogy, I know that he/she may not be representative of the whole population and the amount that you pay in income taxes is when you file your taxes either with more taxes owed or a tax return. But it could be a decent estimate without going into to much detail.

I don't see how eliminating payroll and incomes taxes would be political suicide. The vast majority of Americans would support it. Hell even young people who work low wage jobs would support the repeal of payroll taxes.

Re: Re: Re:

I didn't say that the economists weren't also mentioning eliminating income taxes. I was saying that the use of the term "payroll taxes" was not what the AC likely meant when he said:

"The vast majority of Americans would support it. Hell even young people who work low wage jobs would support the repeal of payroll taxes."

Young people who work low wage jobs, in my experience, don't know or care about whether or not their employer has to pay a tax for employing workers.

Withholding from an employee's paycheck is still just income tax. The more common use of payroll tax is a reference to the employer. Otherwise, the economists wouldn't have said, "Payroll taxes discourage creating jobs." Income tax withholding for employees doesn't discourage creating jobs, but taxing employers for hiring people would.

Cutting corporate income taxes would be fine, but only if it were accompanied by a couple of other changes.

- Tax all income, no deductions, no exceptions for investment income etc. If you get money, it's income. This would also include inheritances, gifts, whatever.

- Tax any and all money leaving the country. If a company wants to invest overseas, or an individual wants to throw money into an offshore bank account, go ahead, but the government takes a share of the money first.

Bad writing.

If your article is about the economy and 5 of your six fixes are bout taxes, you are essentially saying that 5 out of 6 problems with the economy have to do with taxes. Shit writing, shit pool of economists that all drink form the same well.

Re: Bad writing.

The economy is created by businesses, not the government. The government creating jobs is like your dad hiring you to mow his lawn for the summer. It is inefficient.

The government can help the economy by getting out of the way. The 2008 bust was created, in part, by the government "encouraging" home ownership, funding stupid loans through Freddie and Fannie, requiring the *seller* (not the buyer?!?) to get ratings on their mortgage backed securities, etc.

You wouldn't let a government employee do open heart surgery on you, so why would you let them try and manage the economy? Do people think running a business is easy?

Re: Re: Bad writing.

The economy isn't just about businesses, but is also about customers. You can't have businesses without customers and businesses can't do well if customers don't have money to spend. The government getting out of the way (deregulation) contributed to the 2008 bust. The government failing to punish those involved (including those in the businesses and the government) is only going to let something like that happen again. The government shouldn't run the economy, but neither should businesses.

Re: Re: Bad writing.

The 2008 bust would have happened even without Fannie and Freddie. F&F were behind the curve on subprime loans. For the first part of the housing bubble, F&F wouldn't even accept subprime loans. Mind you, F&F also have regulations that say their mortgages only cover 80% of the home cost at most, so the other 20% for Countrywide's famous 0% down loans had to come from somewhere that WASN'T F&F.

Angelo Mozilo met with the head of Fannie Mae and told him "if you don't start taking our subprime loans you will lose your whole market share to Wall Street". That's when F&F started taking subprime loans.

Had F&F never done that, you can bet that Wall Street would have still bought all those loans, and the loans still would have been made.

Re: How?

In Canada, low income individuals get a partial federal sales tax rebate each year when they file their taxes, however we have both income and consumption (sales) tax.

The big problem with consumption tax is not that it isn't progressive, but that it encourages the creation of an underground economy where people offer goods and services without collecting (or submitting) the consumption tax. It happens all the time in Canada where the federal sales tax is only 5%. Any system that had to replace both personal income and corporate taxes would be more like 25% to 30% which is a huge incentive for people to cheat the system.

Re: Suggestion #5 is utter nonsense

Off topic perhaps...but are you trying to say that CO2 ISN'T a large, contributing factor to climate change? I'm just curious, beacause it's that kind of thinking that's going to have us all swimming to work every morning...

Re: Suggestion #5 is utter nonsense

Why don't you go flush your savings down the toilet.

Weird suggestion?

It's the same though, you take something finite and waste it completely. Does that make sense? No. That's why taxing a finite resource like fossil fuels does make sense if people refuse to use it responsibly. Somehow people often become a lot more responsible if you hit them in their wallets.

Missing the point...

What's really unfortunate, of course, is that we can't even have reasonable discussions about most of the proposals above.

And from reading the comments, you seem to be absolutely correct. No one seems to even be willing to read beyond the first sentence of the proposal summaries in this article. Y'all should actually listen to the show and get the details instead of the knee-jerk reactions. These are NOT crazy GOP schemes to kill the poor but actually widely viewed problems that most economists across the board agree on. The show itself goes into an in-depth discussion of each of the proposals, but everyone here seems to just want to read the first sentence and shout them down.

Re: Missing the point...

Some of those are just so stupid that you don't have to read past the summary.

"Three: Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich people."

This is only convincing to someone that has no clue about the tax code. A company does not get taxed on what it "invests" into the business. Those are expenses and corporations are already given a very favored status in this regard.

Business entities get to "take things off the top".

A lot of this kind of thing is just propaganda that only plays well to ignorant conservative farmers in Idaho that just don't know any better.

poor logic

Yes, there's something wrong with politics. But that can't be logically derived from the premise of the article.

The trouble is that the very reason that these policies appear to effect political suicide is because each one is worded as though the proposed policy were presumed to be instant and unilateral, and most of them represent huge change with a huge scope of impact and include no plans for maintaining stability of any kind. It's NOT wrong to insist that the negative effects of instability

First let's weed out the bull. 1 & 2 are moot if we accept 3 and 4. 5 is completely disingenuous: 1) because it's an underhanded way of saying let's raise fuel taxes without calling it a fuel tax 2)because a carbon emissions tax =/= fuel tax. Even if you ran only zero emissions engines, you'd still be paying the higher fuel prices. So, it's not true at all that you're paying a higher tax for doing something bad, but rather you're paying a higher tax because some people do bad things with their fuel whether you do that or not (Imagine charging a piracy tax for people who download legitimate content from so-called Pirat-ey websites who also happen to offer uploaded pirated content). What you're really paying extra for is how far you are from things. You might as well charge a rural living tax because the farther you are from a large city, and from a large port city, the more bad you are. So 1,2, and 5 are just plain crap.

The most glaring examples of what would really be political suicide then are 3 & 4. From a purely economical perspective they sound great (maybe) in terms of the ultimate outcome, but they ignore one of the most basic requirements of any government, which is keeping the peace.

You can't honestly tell me that if tomorrow we turned off corporate income, payroll, and individual income taxes that we would survive the economic and social aftermath. It would be effing belgium bonkers!! So of course they sound like political suicide, and that's not a bad thing.

That no one bothered to even attempt to describe a plan that would phase in this kind of change in a way that would be socially sustainable, that's something wrong with politics--not that people don't want to vote for econ profs who forgot to do their poli-sci homework.

#7, I suspect that this one was thrown in to add to the cool factor of the whole, but really, it seems to me the most sensible suggestion of all of them.

Re: poor logic

Of course you could not just flip a switch on any of these policies. I imagine that the best way to implement something like this would be to slowly decrease the income and payroll taxes, while at the same time increase the consumption/carbon taxes. I mean, do you really think that any rational person would ever advocate that kind of change in an abrupt manner? Just cause it will take time to implement, does not mean that it is a bad idea.

"The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it.
The first lesson of politics is to disregard the first lesson of economics." - Thomas Sowell

Here's the complete guide to winning the hearts of voters:

1. People want stuff.
2. People don't want to pay for any of it.

If you say you're not going to give people stuff, they don't vote for you.
If you say you're going to tax people more so that you can buy them the stuff, they won't vote for you.

To get elected, you have to say you're going to give them stuff, but also convince them that they will never have to pay for it. This means (a) borrowing until the economy collapses, or (b) printing money until the economy collapses. Rinse and repeat.

The problem with politics is not politicians; the problem with politics is the voters. Every country gets the leaders it deserves.

"A democracy cannot exist as a permanent form of government. [...] It can only exist until the majority discovers it can vote itself largess out of the public treasury."

Wouldn't it be simpler to just dissolve the union and allow states to become nations?

That way, I could keep more of my money paying for things in my own backyard rather than paying for other governments' inability to manage their expenses...yes, I'm looking at you Southeastern and Southwestern states

I always find people buying big houses just to get a big mortgage interest tax deduction absurd. I mean do some simple math.

$500 a year in interest payments you get to write off your taxes.
A 35% tax rate.
That means you spend $500 to avoid paying the government $175 a year, how is it worth $325 a year to do this if you already had the money to pay for your house without a mortgage?

Sure it may be worth it a year or two if that $500 less pushes you into a lower tax bracket, but guess what, taxes and income brackets and your income change over the years. You can't depend on mortgage pushing you into a lower tax bracket every year for it to be worthwhile, unless perhaps you're a contractor who decides to earn a specific amount of money and not a penny more and to just take a vacation for the rest of the year once you hit that number.

progressive taxation

seeing as how we have a massive debt and demand side issue stalling everything here are some truly radical ideas that would spell political suicide.

1) a truly progressive income tax, no taxes on incomes under 100K, tax income after that on a slow curve with a maximum income somewhere around 5 million, do away with people making billions, it serves us no use.

2) pay off all student loans, people shouldn't be charged for education, are we just stupid? Fund state universities.

3) fund universal health care.

4) make banks into non-profit public utilities.

5) put a cap on stock ownership.

6) create a three strikes rule for corporations, if they commit three crimes their charter is revoked and all stock is rendered worthless.

7) slowly dismantle the military and convert all soldiers to work on urban renewal projects. end all military contracts, give all effected workers five years pay.

Mortgage Interest Tax deduction

I've always wondered why the deduction is based on the interest paid. Why not a fixed deduction (or credit) like most of the others (take the child tax credit: you have a child? $1000 credit -- not based on how much it costs to raise a child). The supposed purpose of the interest deduction is to promote home ownership, but it seems to me to just promote mortgage "ownership". This would limit the benefits of McMansions, and could be considered a way to pass money to local communities through their property taxes. A compromise that provides a number of benefits, but is unlikely to ever happen.

In general however, these ideas aren't the source of political suicide. The suicide is based on the modern electorate's seeming unwillingness to allow their representatives to compromise.

Treat all income the same

No more "capital gains" vs "ordinary income". Especially because people easily conflate the two and imply that Americans' 401K will be raided if capital gains goes up - 401K is paid as ordinary income, not capital gains!

Income is income. Treat it all the same. There's no reason we should reward people who sit on their ass and give money to others to do the work, more than we reward the people who actually do said work.

Most of these ideas are bad

the problem is there is scientism at work here: economists pretending to be "neutral" and "scientific" in trotting out policy and normative proposals. You cannot do this as an economist; you have to base it on some other value or normative ideas (see Hume's is-ought dichotomy).

No tax should be increased--not carbon taxes, and not by eliminating deductions. That is just a tax increase. The problem is state regulation and spending. That needs to be cut. The idea to "replace" the income tax with a consumption tax is ridiculous; the problem is not the form of tax: it is the amount. Just lower income tax rates. Cut them by half. Whatever. And cut spending to match.

Yes,, marijjuanaa shouuld be legalized, but so should all druugs. And of course pateent and copyright shoulld be abolished.

Re: Most of these ideas are bad

You mock faux-neutrality, and then trot out the most right-wing talking point; that no taxes should ever be increased.

This isn't *an* economist. This is a very *diverse group* of economist and the things they can agree on. There are economist who very much think government spending being as high as it is is not inherently bad.

Re: Re: Most of these ideas are bad

Far be it for me to speak for Kinsella, but I think you misunderstand him. His point is that economics can only tell you "is", and never "ought".

For example, an economist can tell you that the minimum wage increases unemployment, but that he can't tell you that you "ought" not to have minimum wage. If your goal is to increase unemployment among poor people and minorities, then a minimum wage is exactly what you should have.

But such a determination is normative, and not scientific.

You can say, scientifically, what the effects are of raising or lowering taxes, but once you say whether or not we should raise or lower taxes, you are no longer doing science; You're just giving an opinion.

Re: Re: Re: Most of these ideas are bad

Exactly Chris. Nicely done.

Mudlock: "You mock faux-neutrality, and then trot out the most right-wing talking point; that no taxes should ever be increased."

But I am not pretending to say it as an economist. Moreover, this is not a right wing view at all. The right wing is not opposed to taxes. How else will they fund their huge military spending or pay for the secret police and drug prisons?

"This isn't *an* economist. This is a very *diverse group* of economist and the things they can agree on. There are economist who very much think government spending being as high as it is is not inherently bad."

Still. Most economists are as socialist as the typical moron voter and product of public schools. The main ones we should listen to are adherents of the Austrian school of economics.

Crazy

The problem is that this path has been tried and it does not work.
Big business has not allowed the trickle down affect to do its thing, they refuse to invest and take all of there profits out of the country.

What needs to happen is that 32 trillion or more in offshore accounts needs to be seized by the government and used to improve everyone's lives. by investing in infrastructure like upgrading roads, water and electricity networks and encouraging people to start up there own businesses.

Money just sitting there making a little or a lot of profit in interest is just not how the system works and is one of the reasons it is collapsing.

Re: Crazy

"It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a 'dismal science.' But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance." ― Murray N. Rothbard

Inane

Sigh. The west continues to suffer from the irrationality of free market fundamentalism EXACTLY as the east did (and continues to) from communism. The answer to too much stupid politics is not to resort to MORE mindless ideologically driven actions from yet more dimwitted economists. STOP MAKING THE SAME MISTAKES OVER AND OVER. Since reagan all anyone can talk about is "cutting taxes" and since reagan what have we gotten for listening? A moribund economy with a skyrocketing poverty level and a 10% unemployment rate. Cities GOING BANKRUPT. How about we start focusing on "good government" rather than "no government" for a change? How about we start simple? You want LOWER health care costs? STOP IGNORING THE EVIDENCE AND SOCIALIZE THE FUCKING SYSTEM ALREADY. We pay twice as much per capita and we don't even provide health care for a huge chunk of our population. Every other wealthy nation on earth has learned this lesson but us. The free market makes great smart phones but does NOT belong in health care: when you are sick YOU WONT BE SHOPPING AROUND. I am so tired of the free market bullshitters who just close their eyes to the world around them and repeat their mindless mantra that the world is black and white and there is only a single answer to every problem. You fiddle while Rome burns. I find myself increasingly in agreement with others who have suggested splitting the union and letting the fundamentalists of every stripe make their own way, except that there will still be a lot of people in the resulting third world "free market" states that will suffer through no fault of their own. of course the "all government is evil" types know that they are full of shit and won't go along because what they have now is sweet, the full benefit of a social contract without having to pay into it.

Five: Tax carbon emissions. Yes, that means higher gasoline prices. It's a kind of consumption tax, and can be structured to make sure it doesn't disproportionately harm lower-income Americans. More, it's taxing something that's bad, which gives people an incentive to stop polluting.

This ^^ is idiocy. If you want an economy that is growing, YOU NEED CHEAP ENERGY. There is no better historically-proven solution to expanding an economy than providing more inexpensive energy. China is growing gangbusters because they have cheap energy. History has *always* demonstrated that those with cheap access to energy have the greater economy. Taxing carbon makes energy MORE EXPENSIVE. That's not just political suicide, that's economic suicide.

I have to wonder about anybody who says or implies that the "free market" will fix anything......it seems to me that if you give them total freedom we will just endup with even less choices then we have now....

example, look at internet service, most places one or 2 ISP's have a market monopoly on high speed internet service, infact thats why verizon sold off its fios services and stopped expanding that network, they came to an accord with the linkes of Warner, charter, comcast, exct, they where paid in one way or another to stop impinging on their service area's......

the so called "free market" only works if everybody/company that wants to enter a market is given even footing to start and offer services and goods.....that cant and wont ever happen in this country, because despite our anti-monopoly laws, we really do love our monopolies.....at least our govt and the wealthy who support/run it do.....it means more money for them!!!!

the current tax system is horrible, overly complex....for a reason, its designed to work as it does, insure the wealthy pay as little as possible and the rest of us pay as much as they can get away with taking.....

when i was able to work, it always shocked me seeing 1/3-1/2 my check taken before i ever saw any of it.....govt taxes, unemployment, exct.....the worst was when I was working part time and ended up getting all that money back at the end of the year......why did they even take it in the first place?

oh yeah, because if they take my money, bank it, and make me wait to get it back, they can keep the interest they earned on it.......

Just too big

The main problem is that the US is. Just. Too. Big.

So are the corporations that pull the strings on our bloated government.

Shrink them all, forcibly if need be, and things will change. Dissolve all corporations and businesses with enough capital to influence any kind of government, and forbid any others from growing to that size. When they approach that size, slice them up into smaller non-profit-sharing companies. Do the same for all existing companies capable of influencing government.

Seize all offshore funds and redistribute them to the general populace. Bring all military home, reduce its size to the minimum necessary amount and cut spending on it drastically. Abolish patents, revert copyright to its original constitutional limit of 14 years with one and only one 14 year renewal.

Re: Just too big

we should first of all move from our current govt to one based on the articles of confederation....that would be a great start.

dont tell many of my left wing nut friends that tho, they feel we need even more powerful, expansive and invasive central government.....(but in all honestly so do the right wing nuts...)

as a good friend of mine put it

the right wing want govet so small it can be up every citzens arse,vigina,cock, the sad part is, the left want the same thing....

im tired of this shit....we need to go back to being UNION OF STATES.....oh yeah and we need to end the corporate ownership of our govt.....i think if we take every politician thats taken money/incentives to do things against the public interest and the ceo of every company thats paid them off (or had lobbiests pay them off) as well as said lobbiests, and we setup a new pay per view event....

pay per view Draw and quarter traitors.......the money goes to repairing the harm they have all done......bet it would be a money spinner and great incentive to the new batch of politicians to not fuck over the public for corporate interests

Economic advice

And these are experts??? In what universe!?!?
We eliminate income and payroll taxes and put in consumption taxes - really fair, right? So, people who have a high income make their money here, consume in, say, Canada or France, etc., and pay no taxes at all, while people who can't afford that pay all the bills, and that's fair?
Who do these people work for - Romney? Oh, now I see, yes, very fair for people making millions per year!!!!
Einstein was RIGHT! The only thing we KNOW is infinite is human stupidity!

Re: Economic advice

Yes,t he only way to make taxes more fair is to lower them. Lower the rates. That is why the politicians distract us with talk of tax simplification, etc. THey don't want to lower revenues--or spending.

Hey Techdirt, out of your league

Stick to the technical analysis of the impact of technology and the Internet to the business practices of modern corporations, and stay the hell out of the neoliberal, Republican, voodoo economics political hackery. Any more posts like this make this blog a useless destination.

#3 wont work

I love that this is even being discussed. It fits well with my general belief that you should "Tax people for things you don't want them to do, not for the things you do want them to do."

While I understand and agree with the reasoning behind all 6 points, I differ slightly on how I would implement them.

1. Replace the mortgage tax deduction with a large onetime capped deduction for first time buyers.

2. Instead of taxing the company for health benefits, make them a taxable benefit paid for by the employee. You should never tax a company for hiring more people. However this point and the one above it are mute if you eliminate income tax.

3. I agree completely with eliminating the corporate income tax. You want them to keep their profit in the country, not trying to move the profitable parts of their business offshore.

4. I strongly agree with eliminating all income and payroll taxes. However while a Consumption Tax is the lesser of two evils, I think it would be better to replace the revenue with taxing things you don't want people to do. Increase the US taxes on gas, cigarettes and alcohol to what Canada charges or slightly above. Enormous fines for corporate fraud. Large fines for bogus DMCA takedown notices. Large fines for frivolous law suits. Etc etc.

5. Yes increase gas taxes some, but don't stop there on pollution taxes. Tax gas guzzling vehicles to bring the sticker price in line with hybrids. Tax other types of pollution so pollution controls and alternatives become a cost savings.

6. Tax marijuana so heavily that it costs almost as much as it did before legalization.